State Approves Smaller Con Ed Rate Hikes While Trump and Mamdani Shape the Optics

With energy costs poised to rise, a rare alliance across the political spectrum puts New York’s affordability crisis—quite literally—in the spotlight.

To witness both President Donald Trump and Mayor-elect Zohran Mamdani stand united against an electric utility is a tableau few New Yorkers, let alone jaded city editors, ever expected. When the president, a property mogul turned populist, and the incoming mayor, an avowed democratic socialist, publicly called for lower rates from Consolidated Edison last week, jaws dropped from Wall Street to Woodside. Yet, as political theatre unfolded on television, the underlying plot had already been decided: Con Edison had quietly secured approval for multi-year rate hikes from the state.

Under the pact with the Public Service Commission, Con Ed will nudge electricity bills up by 3.5% in 2026, 3.2% in 2027, and 3.1% in 2028. Gas customers will face steeper gradations: 4.4%, 5.7%, and 5.6%, respectively. The result? A typical city dweller will fork over an additional $4 per month for electricity next year, and as much as $15 more per month for gas by 2028. These figures may strike some as puny increments, but given the city’s relentless cost creep, the optics are poor and the effect cumulative.

For a metropolis where four out of ten residents grapple with the affordability of basic utilities, the increases—however moderated—provoke palpable resentment. Outcry was not confined to the Twitterati. In a record haul, more than 20,000 New Yorkers submitted comments to regulators, visiting every shade of indignation from anxious to apoplectic. Many, like one Lauren Boudreau who threatened to “work by candlelight,” see the hikes as existential threats, not just wallet pinchers.

To its credit—or cunning—Con Edison originally sought far steeper rate hikes: a 13% rise for gas and a whopping 19% for power, or $46 and $26 more per household per month, respectively. By the time commissioners whittled those proposals down—60% less for gas, 34% less for electricity—the surly mood had scarcely softened. Consumer advocates called for an outright rate freeze. City Hall, the New York Power Authority, and even Amtrak grudgingly backed the final compromise, along with environmental campaigners, hailing it as a necessary evil to support grid resilience and long-term decarbonisation.

For Con Ed, the logic is unyielding. Jamie McShane, its unflappable spokesperson, insists, “Affordability is a critical issue, but so are the investments needed for reliability and resilience.” That reliability has been tested recurrently, especially each August as air-conditioners strain substations and, on occasion, plunge sweltering boroughs into darkness. The PSC, wary of incidents remembered by those of us who have trudged down pitch-black stairwells, deems some increases simply essential.

Yet the ripple effects of even modest hikes radiate outward. Energy costs feed the inflationary cycle hobbling the city’s working poor and middling classes. Small businesses, grocers, and landlords—already squeezed by surging insurance, taxes, and rents—may simply pass costs to customers. Higher power and gas prices exacerbate an already acute housing affordability crisis, risk pushing vulnerable residents into energy poverty, and can deepen disparities across neighbourhoods. In a city so preoccupied with equity, the upward pressure is unwelcome.

Nor is this a uniquely New York predicament. Nationally, Americans face the highest average electricity bills on record, according to the U.S. Energy Information Administration. Utilities, citing demands for remodelling fossil infrastructure and girding against climate-induced extremes, are seeking and receiving approval for similar increases in Chicago, Los Angeles, and Boston. Yet, only in New York do both left and right wield the bully pulpit simultaneously, underscoring the city’s signature blend of spectacle and genuine public ire.

Internationally, cities in Europe have responded to soaring energy costs with robust subsidies and price caps—measures America’s laissez-faire tradition tends to eschew. The UK introduced windfall taxes on suppliers; Germany ramped up direct cash support for low-income tenants. New York, by contrast, offers only a patchwork of energy assistance schemes, and places primary faith in regulatory negotiation and public shaming. The modesty of the approved increases may bode well for the credibility of that approach—yet New Yorkers’ patience may be finite.

A rare bipartisan consensus but few easy solutions

Set against the backdrop of record-breaking inequality and an arguably sclerotic grid, New York’s agreement with Con Edison is both a partial victory and an uneasy truce. Trump and Mamdani’s joint condemnation played as momentary populism; privately, neither possesses the powers—nor the appetite—to nationalise or fundamentally restructure a behemoth utility that supplies power to over nine million people. And while the Public Service Commission has proven responsive to public comments, its room to manoeuvre is limited by capital markets and hard engineering constraints.

The real tension is structural. New York’s electrification goals—phasing out gas, increasing renewables—demand billions in fresh capital. Con Ed must invest to decarbonise, digitise and storm-proof its grid, all while keeping costs “affordable for everyone”—an alchemy no public utility in the Western world has yet pulled off. Each rate negotiation thus becomes a high-stakes effort to split the difference between long-term resilience and short-term pain.

As temperatures climb and consumption grows, the city’s vulnerability to power shocks will only intensify. Blackouts today could portend larger crises tomorrow, especially as the city’s reliance on electrified transport and heat increases. Meanwhile, the overlap between those hurt by energy cost increases and those at risk from climate hazards is uncomfortably substantial, further complicating any policy response.

The city’s political ecosystem has delivered yet another teachable moment: populism’s limits, regulatory sausage-making, and the law of unintended consequences. So long as New York remains an emblem of global ambition but local precarity, utility bills will continue to serve as proxy for larger debates over what—and who—the city is for.

Still, if odd-couple public scoldings and marathon comment periods can moderate the ambitions of a quasi-monopoly, perhaps there is merit in New York’s particular brand of noisy democracy. Even the grumpiest editor can, just barely, detect a glimmer of hope. ■